PMEGP full form is the Prime Minister’s Employment Generation Programme, a government credit-linked subsidy programme to provide financial assistance to set up new enterprises and boost employment opportunities in rural and urban India. The Khadi and Village Industries Commission administers the programme on the national level.
The government subsidy on the project varies from 15% to 35% while the enterprise owners need to invest only 5% to 10% of the project value. The funding is offered by banks in the form of a term loan or a working capital loan. However, the project cost is capped at ₹50 lakh for manufacturing units and ₹20 lakh for business units.
Here are some of the key details of the PMEGP:
Depends on the bank (typically up to 12% p.a.)
Minimum age of the applicant
Minimum educational qualification of the applicant
VIII passed subject to terms and conditions
Government subsidy rate
15% to 35% depending on rural or urban projects in general or special category
Maximum project cost
₹50L for manufacturing units and ₹20L for service units
Entrepreneurs, MSMEs, Co-operative Societies, Charitable Trusts, Self Help Groups, etc.
Objectives of PMEGP
To provide financial assistance from government and banks to new micro-enterprises in both urban and rural areas of India
To create sustainable employment opportunities, especially for youth and women, through the establishment of new ventures
To promote self-employment among the unemployed youth of the country
To limit forced migration to urban areas by enhancing employment opportunities in rural areas
To encourage the setting up of micro-enterprises in traditional as well as modern industries
To enhance the overall economic development of the country through the creation of new businesses and job opportunities
The minimum educational qualification to avail of PMEGP assistance is Class VIII passed, subject to further terms and conditions
The PMEGP credit subsidy is only available for new projects
Applicants must undertake a mandatory Entrepreneur Development Programme (EDP) training to be eligible for loan sanction
The assistance is only available for business owners, entrepreneurs, MSMEs, SHGs, charitable trusts, societies registered under the Societies Registration Act of 1860 and production so-operative societies
Documents Required While Applying for PMEGP
PMEGP application form with passport-sized photographs
Identity & address proofs like PAN card, Aadhaar card & VIII Pass certificate
Special category certificate, if applicable
Certificate of EDP
Caste Certificate for SC/ST/OBC/Minority/Ex-Servicemen/PHC
Certificate of academic and technical courses, if any
Any other documents required by the lender
The Prime Minister’s Employment Generation Programme or PMEGP has proven to be a successful initiative in promoting entrepreneurship and creating employment opportunities in India. The scheme has resulted in the creation of 4.43 lakh jobs until January in FY22-23 alone, and has been extended to FY25-26 with a total outlay of ₹13,554 crore to create 40 lakh jobs.
That said, if you’re looking for urgent cash to start or expand your business, you may consider going for an instant Navi Cash Loan of up to ₹20 lakh starting from 9.9% p.a.
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